Late last week Kroger held its Fourth Quarter 2016 Investor Conference Call and despite the operating environment being more challenging than expected, Kroger achieved sales of $115.3bn for 2016, up 5% on 2015 or 1% on a like-for-like basis.
“True to our history, we will continue making proactive investments in our Customer 1st Strategy to maintain our strong competitive position. We are lowering costs to invest those savings in our people, our business, and technology. This approach will enable us to deliver on our long-term net earnings per diluted share growth rate target of 8 – 11%, plus an increasing dividend, as it has in the past.” according to Chairman and CEO Rodney McMullen “In 2016, Kroger grew market share, increased tonnage, and hired more than 12,000 new store associates. For 2017 and beyond, we will continue delivering for our customers while also setting the company up for our next phase of growth and customer-first innovation.”
Total sales increased 5.5% to $27.6 billion in the fourth quarter compared to $26.2 billion for the same period last year. Total sales, excluding fuel, increased 4.4% in the fourth quarter over the same period last year. Recent mergers with Roundy’s and ModernHEALTH contributed to this growth.
McMullen went on to sing the praises of Private Brand “Corporate Brands business was another real bright spot in 2016. Our brands are in more homes than ever before. In fact, our customers fill their carts with more than 1.25 million Corporate Brand items every hour.
We are incredibly proud of the quality of our Corporate Brand products. Our quality is only getting better, and that showed clearly in Corporate Brands performance last year – when we sold a record number of units – and in the fourth quarter – when Corporate Brands hit an all-time high unit share of 29.2%.
Simple Truth grew at an impressive rate again in 2016, reaching total sales of $1.7 billion. Simple Truth Organic accounted for more than a billion of that figure last year!
And we still see more growth ahead in our Simple Truth and Simple Truth Organic lines. In fact we’ve begun offering Simple Truth to even more customers throughout the U.S. by making it available on Vitacost.com. Today you can find online and conveniently ship 5 to home many of our Simple Truth food, snacks and supplements, as well as household and personal care products. Interestingly, New York City is already the #2 market for Simple Truth online sales, even though we don’t have a store presence there.”